TMUS earnings analysis
What we found in TMUS's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
T-Mobile delivered 8% year-over-year revenue growth to $22.791 billion and 12% Core Adjusted EBITDA growth to $9.537 billion, while diluted EPS rose to $2.99. Sequential revenue was down 1.4%, but gross and operating margins improved materially from Q1; versus Q2 2025, gross and operating margins were modestly lower as acquisition, fiber-wholesale, device-mix and restructuring costs increased. Operating cash flow and Adjusted Free Cash Flow grew 7% and 4%, respectively, although cash fell to $2.8 billion amid debt repayment, $7.1 billion of six-month share repurchases, dividends and higher investment. Management's principal forward signals are $1.2 billion of UScellular annual run-rate synergies, integration costs of about $2.6 billion, and capex maintained in 2026 versus 2025.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Postpaid-led revenue grew 8% year over year
- Revenue was $22.791 billion, up $1.659 billion, or 8%, year over year, led by a $1.775 billion (13%) increase in postpaid revenue to $15.853 billion. Revenue declined $319 million, or 1.4%, sequentially from $23.110 billion in Q1 2026.
- Margins recovered sequentially, softened year over year
- Gross margin was 64.8%, down roughly 30 bps from 65.1% a year earlier but up 300 bps sequentially from 61.8%. Operating income rose 5% year over year to $5.490 billion; operating margin was 24.1%, versus 24.7% in Q2 2025 and 19.5% in Q1 2026.
- EPS expanded despite integration costs
- Diluted EPS was $2.99, up $0.15 from $2.84 in Q2 2025 and $0.72 from $2.27 in Q1 2026. Net income increased $17 million year over year to $3.239 billion despite $195 million of quarterly UScellular merger-related costs.
- Core EBITDA and account monetization accelerated
- Core Adjusted EBITDA increased $996 million, or 12%, to $9.537 billion, and its service-revenue margin expanded 100 bps to 50%. Postpaid ARPA increased $3.04, or 2%, to $152.91, supported by higher fee revenue and customers per account.
- Cash flow rose despite higher capex
- Operating cash flow rose $508 million, or 7%, to $7.500 billion and Adjusted Free Cash Flow increased $201 million, or 4%, to $4.797 billion. Cash capex was $2.703 billion, up 13% year over year and equal to approximately 11.9% of revenue.
- UScellular synergies underpin longer-term outlook
- The UScellular integration is expected to deliver $1.2 billion of annual run-rate cost synergies, including $950 million of operating-expense savings and $250 million of capex savings. Management expects total costs to achieve, excluding accelerated depreciation, of approximately $2.6 billion through fiscal 2027.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Account growth slowed and churn increased
- Postpaid net account additions declined 41,000, or 13%, year over year to 277,000, while postpaid account churn increased 7 bps to 0.99%. Management attributed the deterioration principally to a larger account base, higher broadband-only accounts and higher industry switching.
- UScellular integration remains a large cost burden
- UScellular merger-related costs reached $195 million in Q2 and $830 million in the first six months, including $142 million of quarterly cash payments. The company expects approximately $2.6 billion of total costs to achieve, excluding accelerated depreciation, with substantially all costs and payments incurred by fiscal 2027.
- Lower cash balances and substantial debt load
- Cash and cash equivalents fell to $2.8 billion at June 30, 2026 from $5.6 billion at December 31, 2025, while total debt and financing-lease liabilities were $86.9 billion, excluding tower obligations. Interest expense, net increased $133 million, or 14%, to $1.055 billion in the quarter.
- Restructuring charges add execution risk
- The Network Restructuring Initiative incurred $63 million in Q2 costs and is expected to require $500 million to $800 million in total, with a majority incurred by year-end 2026. Retail closures also generated a $108 million pre-tax charge in Q2.
- Cybersecurity risk factor was expanded
- The only updated risk factor emphasizes escalating cyber exposure, including more sophisticated AI-enabled attacks. The filing identifies prior cyberattacks in August 2021 and January 2023, and says related claims, litigation and an FCC investigation generated significant costs.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $2.99
- Gross margin
- 64.8%
- Operating margin
- 24.1%
- Segment
- Postpaid revenues: $15.853 billion, +13% year over year
- Segment
- Prepaid revenues: $2.473 billion, -6% year over year
- Segment
- Wholesale and other service revenues: $657 million, -8% year over year
- Segment
- Equipment revenues: $3.524 billion, +2% year over year
- Segment
- Other revenues: $284 million, +11% year over year
What they said about what is next.
The 10-Q does not provide quantitative revenue or EPS guidance. Management expects 2026 capital expenditures to be maintained versus 2025, while UScellular integration costs are expected to be substantially incurred by fiscal 2027.
The filing reads about the same as the one before it.
What came before.
- 10-Q · April 28, 2026
- T‑Mobile reported March 31, 2026 quarter revenue of $23,107 million, an 11% increase versus $20,886 million a year ago, driven by postpaid revenue which rose 15% to $15,629 million. Operating income fell to $4,497…
- 10-K · February 11, 2026
- T-Mobile positions itself as the “Un‑carrier” with a customer-first, AI-enabled strategy and a stated goal to be “Famous for Network,” leveraging a dense multi‑layer 5G spectrum portfolio. Operationally 2025 showed…
- 10-Q · April 24, 2025
- T‑Mobile reported Q1 2025 revenue of $20,886 million, up $1,292 million (+6.6%) versus Q1 2024, driven by higher postpaid service and equipment revenue. Operating income rose to $4,800 million (operating margin ~23.0%)…
- 10-K · January 31, 2025
- T‑Mobile emphasizes an Un‑carrier strategy centered on network leadership, customer experience and an AI-enabled digital transformation. The company reports scale with 129.5 million postpaid and prepaid customers (Dec…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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